Belfast Telegraph

North Korea tension hits market as traders seek safety

By Ben Woods

Mounting tensions between the United States and North Korea battered blue-chip stocks yesterday, knocking the London market's attempts of securing a record high.

The FTSE 100 Index closed down 44.67 points at 7,498.06 after US President Donald Trump told North Korea he would unleash "fire and fury like the world has never seen" following suggestions the country can now strike America with a nuclear missile.

Pyongyang responded by saying it was studying plans for an attack on Guam, a US territory and home to Andersen US Air Force Base.

The heightened rhetoric dragged London's top flight back from 7,542.73 on Tuesday, when it came within a whisker of reaching the all-time closing high of 7547.63 recorded on May 26 and June 2. European markets were also struggling amid the simmering political stand-off, with the Cac 40 in France dropping 1.4% and Germany's Dax tumbling by 1.1%.

Precious metals miners were among a smattering of UK stocks enjoying a stronger session as investors set course for safe havens.

The price of gold rose 1% to $1,274.39 per ounce, with Fresnillo and Randgold Resources up 72p to 1,544p and 200p to 7,380p respectively.

David Madden, market analyst at CMC Markets UK, said: "European stocks have suffered greatly as traders were prompted to cut-and-run due to the escalating tensions between the US and North Korea.

"The stand-off between the two countries has encouraged dealers to dump stocks and seek safe haven investments such as gold.

"While the two nations are at loggerheads, it is going to be difficult to imagine money flowing into stocks."

On the currency markets, the pound was marginally higher against the US dollar at 1.30 and up 0.1% versus the euro at 1.11.

In UK stocks, Worldpay Group was among the biggest risers after the firm agreed a £9.3bn merger deal with US rival Vantiv in a tie-up that will create a global payments processing giant with a combined value of £22.2bn.

Belfast Telegraph